Inventory Control System Using Distribution Requirement Planning (DRP) (Case Study : Food Company)

Abstract

Distribution and inventory are two major components that causes total cost of the product become high. Those two components are not categorized in to the process that added value to the product. This research use Distribution Requirement Planning (DRP) to find the right quantity and short replenishment time in inventory decision that manufacture industries faced to supply their own Distribution Centers and Warehouses in food Company. DRP giving the lower total distribution cost than actual cost. It is because DRP supply products at each Distribution Centers and Warehouses in a minimum quantity using Economic Order Quantity. It also using the similar concept with Material Requirement Planning to find the right delivery time so that it can minimize the total inventory time in The supply chain. DRP can be used to solve the inventory and distribution problem in multi echelon supply chain. From this research, using historical data, DRP gave the minimum total distribution and inventory cost than the initial scenario that company used. Based on DRP result, The total Inventory and Distribution Cost from January to December 2019 is 481.251.325,4.